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Title: |
On the Effectiveness of Capital Gains Tax as a
Stabilizer of Real Estate Prices |
| Author: |
Kim, Woo Tack;
Jaang, Daehong; Kim, Kyung-Soo |
| Author
Affiliation: |
Hallym U; Sung
Kyun Kwan U |
| Source: |
International Economic Journal, Winter 1989, v. 3, no. 4, pp. 37-44 |
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Publication Date: |
Winter 1989 |
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Abstract: |
This paper examines the effectiveness of
capital gains tax as a stabilizer of real estate prices. Capital gains
tax is shown to induce long-term holdings of real estate through a tax
deferral effect and hence negate the intended effect. Furthermore, it is
shown that a change in the tax rate may stabilize the price only
temporarily without any lasting effect on the speculative holdings of
real estate. Of course,the presence of property tax, for example, may
affect speculative activities differently--a subject into which this
paper does not delve. |
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